Start a Business in Europe in 2025
Are you an entrepreneur aiming to expand into a high-income market with minimal barriers? Europe is one of the world’s most lucrative regions to launch or grow your business. Each year, hundreds of thousands of businesses open in Europe, benefiting from access to over 448 million people and seamless trade across member nations like Poland, Germany, the Netherlands, and Spain.
Whether you’re a startup founder from India, the USA, or the GCC region, Europe’s diverse consumer base, supportive legal frameworks, and robust infrastructure create unmatched opportunities for success.
In this guide, we’ll walk you through why Europe is a magnet for business owners, the requirements to get started, the best countries to target, and how you can launch your company hassle-free in 2025.
Why Start a Business in Europe?
Starting a business in Europe is a powerful step towards accessing a high-income market, thriving in a stable economy, and capitalizing on unmatched business-friendly policies. Europe’s appeal lies in its diverse yet cohesive economic landscape, with a market that caters to all types of business models, from tech startups to established manufacturing companies.
Here are compelling reasons for business owners to consider Europe:
- Access to a Wealthy Consumer Market: Europe is home to over 500 million consumers, many with high purchasing power. For businesses, this means a ready audience for innovative products and services.
- Business-Friendly Ecosystem: With streamlined processes, comprehensive support for entrepreneurs, and competitive tax incentives, European countries prioritize making it easy for businesses to launch and scale.
- Innovation and Talent Hub: Europe leads globally in R&D investments, making it a prime location for tech-driven businesses. Additionally, it offers a highly skilled workforce across various industries, with expertise in technology, engineering, finance, and beyond.
- Seamless Trade Across Borders: The European Union offers seamless trade across 27 member countries, eliminating tariffs and customs complications, which is particularly advantageous for companies aiming to expand.
Requirements to Open a Company in Europe
1. Residence Permit
Most European countries do not require an employment visa to open a business, but you typically need a valid entrepreneur or residence permit in the country where you plan to operate.
2. Legal Business Structure
Select the right legal form — options include a sole proprietorship, a branch or subsidiary of a foreign company, or a locally registered entity like a Sociedad Limitada in Spain or a UG in Germany.
3. Business Plan
Many European nations require a detailed business plan demonstrating your company’s expected economic impact and sustainability. Immigration and labour authorities will review this before issuing a permit.
4. Minimum Investment & Proof of Funds
Some countries require proof of sufficient funds. For example, to establish an SL (Sociedad Limitada) in Spain, you typically need a minimum share capital of €3,000 plus enough funds to cover operating costs.
To start a UG (Unternehmergesellschaft) in Germany, you can register with as little as €1, but practically it’s advisable to have €1,000–€5,000 to ensure operational stability and meet notary and registration fees.
5. Economic Contribution
Your business should positively impact the host country’s economy or job market. Companies that create local jobs or offer innovative services have higher approval chances.
Best Places to Start a Business in Europe
Europe is a powerhouse for business, offering entrepreneurs a blend of innovation, skilled talent, and access to a vast market.
Here’s how to get started in four leading European countries:
Spain
Spain is a vibrant market ideal for companies in tourism, real estate, and tech. Business registration in Spain is straightforward: secure a company name certificate, and a tax identification number (NIF), and register with the Commercial Registry. Spain’s government offers substantial tax incentives for R&D, especially in emerging tech and innovation sectors.
Germany
As Europe’s largest economy, Germany combines stability with a highly skilled workforce. Register your business in Germany with the local Trade Office (Gewerbeamt) and Commercial Register (Handelsregister) to get started. Germany rewards R&D-intensive businesses with tax deductions and is especially strong in engineering, manufacturing, and green technology.
Poland
Known for its low operational costs and tax-friendly zones, Poland is a magnet for startups, especially in tech and manufacturing. You can start a business in Poland by registering with the National Court Register (KRS) via the CEIDG portal. Special economic zones offer significant tax breaks, making it easier for foreign businesses to grow quickly.
Netherlands
The Netherlands is a gateway to European markets, offering top infrastructure and an easy, digital setup with the Dutch Chamber of Commerce (KVK). The Netherlands provides tax benefits like the Innovation Box, lowering taxes on profits from innovation—a perfect fit for tech-driven and sustainable businesses.
Are you looking to grow your business in the Netherlands? Schedule a meeting with our business experts right now.
How Easy is it to Set Up a Business?
There are many studies by major international organizations like the World Bank that regularly evaluate the business-friendly environment of nations around the world.
The Bank’s Ease of Doing Business Index project provides objective measurements of business regulations as well as their application across 190 countries and select cities across the globe.
The report outlines some requirements that are essential for business operations like beginning a business and dealing with construction, hiring workers, registering properties as well as obtaining credit and making payments for taxes, transacting across borders, enforcing contracts and more.
In the report for 2018 by the World Bank report, the top-ranked European nations are
- Denmark (#3)
- Norway (#7)
- UK (#9)
- Sweden (#12)
- Finland (#17)
Other large economies in Europe are ranked a bit lower
- Ireland (#23)
- Germany (#24)
- Austria (#26)
- Spain (#30)
- France (#32)
- Poland (#33)
- Czech Republic(#34)
- Portugal (#36)
- Switzerland (#38)
- Switzerland (#45)
- Italy (#51)
How Competitive is the Business Environment?
Another popular indicator that is frequently used Global Competitiveness Report which is released every year through the World Economic Forum.
Relying on the explanation of the World Economic Forum it is the Global Competitiveness Report “specifies impediments to development & thereby assists the growth of pertinent techniques to accomplish sustained economic growth.
Its Country Profile Highlights provide an outline of the positive aspects of each nation’s economy. Sweden, Finland, and Denmark for instance are all listed as among the top 17 nations for macroeconomic stability and stability.
They also have good budget surpluses as well as low amounts of public indebtedness. Germany however, on the contrary, is listed as the top in the world for its quality of infrastructure, specifically communications and transportation.
France is also praised for its great infrastructure particularly when it comes to communications, transportation, and energy.
Economic Freedom
The political conservatism Index of Economic Freedom is a collection of economic indicators that are published each year through the Heritage Foundation.
The index explains, “Economic liberty is the primary right of all human beings to prevail in restraint of their job as well as property. In an economy-free society, citizens have the freedom to work and produce, consume and invest however they choose.
The report ranks 186 nations around the world. Surprisingly, the top-ranked European countries are
- Switzerland (#4),
- Ireland (#6)
- UK (#7)
Corruption, Cronyism, Organized Crime, and many other Woes
Corruption is a fundamental aspect of business in several European countries. However, the majority of European countries have a very little or moderate degree of corruption that doesn’t significantly hinder the running of a successful business.
Clarity International’s Corruption Perceptions Index (CPI), a yearly disclosed analysis of corruption around the world can be utilized to assess how much corruption affects everyday life, politics, and the economy of 180 countries across the world.
It is the Corruption Perceptions Index (CPI) is a “survey of surveys”, that depends on 13 several experts’ calculations as well as business-related analyses.
The 2019 rankings exhibit that in common Scandinavian as well as Central European nations possess very low levels of corruption, according to an autonomous CPI:
- Denmark (#1)
- Finland (#3)
- Sweden (#4-tie)
- Switzerland (#4-tie)
- Norway (#7)
- Netherlands (#8)
- Luxemburg (#9-tie)
- Germany (#9-tie)
- Iceland (#11)
- UK (#12-tie)
- Austria (#12-tie)
- Belgium (#17)
- Ireland (#18)
- France (#23)
In 2019, there are a few southern European countries are on the contrary according to The report that corruption is a greater number of countries, which include:
- Portugal (#30)
- Spain (#30)
- Cyprus (#41)
- Malta (#50)
- Italy (#51)
A lot of Eastern or South-eastern European countries also rank relatively low in the corruption index of the report:
- Estonia (#18)
- Poland (#41)
- Slovenia (#35-tie)
- Lithuania (#35-tie)
- Latvia (#44-tie)
- Czech Republic (#44)
- Slovakia (#59)
- Greece (#60)
- Croatia (#63)
- Montenegro (#66-tie)
- Romania (#70-tie)
- Hungary (#70-tie)
- Armenia (#76)
- Turkey (#91)
- Serbia (#91)
It is also fascinating to observe that a handful of the ex-Soviet Republics located in Eastern Europe have been given some of the highest corruption indexes around the globe, as per an independent study:
- Belarus (#70)
- Bulgaria (#74)
- Kosova (#101-tie)
- Bosnia and Herzegovina (#101-tie)
- North Macedonia (#104)
- Albania (#106)
- Ukraine (#126-tie)
- Kyrgyzstan (#126-tie)
- Russia (#137)
- Turkmenistan(#165)
Europe's Leading Business Cities
Cushman & Wakefield, a privately owned commercial real estate firm, is the publisher of its European Cities Monitor which is an annual study of the major European business centers that is based on information and evaluations from 500 top European firms.
London has maintained its top spot since the inception of the survey in the year 1990. These are the top 10 European most renowned business cities:
- London (#1)
- Paris (#2)
- Amsterdam (#3)
- Berlin (#4)
- Frankfurt (#5)
- Copenhagen (#6)
- Munich (#7)
- Dublin (#8)
- Milan (#9)
- Vienna (#10)
Conclusion
Ready to proceed with European company formation?
Europe’s dynamic business landscape, strong legal protections, and world-class talent make it the ideal region for ambitious entrepreneurs. By setting up a company in countries like Poland, the Netherlands, Germany, or Spain, you gain access to stable markets, generous tax incentives, and a strategic gateway to the EU and beyond.
Our team at OnDemand International can guide you through every step — from registering your business name and drafting legal documents to opening your European bank account. Take the first step towards scaling your business globally.
Book your free consultation with our experts today and launch your European success story now!
FAQ’s
Yes! Most European countries welcome foreign entrepreneurs. You’ll need a valid residence permit and may need to show proof of investment and a solid business plan.
Hungary is home to one of the lower corporate taxes in Europe and is taxed at 9 % of earnings from corporations. Local business taxes are payable to the municipalities, but the amount varies and is only allowed to be 2% of the net sales revenue.
In the year 2020, it was reported that the World Bank ranked eight European countries on its top 20 rankings for “Ease of doing business ranking” therefore there are many options for you to consider.
Poland and the Netherlands stand out as two of the best countries for registering a business in Europe.
- Poland- Poland is preferred for business incorporation in Europe due to its low taxation, robust investor rights protection, and ease of company formation. Additional factors contributing to Poland’s growing appeal to foreign investors include its accessibility to a competent labor force and various governmental grants.
- Netherlands- The Netherlands emerges as a highly favored jurisdiction for business registration, due to its attractive tax incentives, skilled workforce, and excellent infrastructure. Its strategic location enables seamless trade with other European countries, while the Port of Rotterdam which is a major European port, facilitates efficient travel and transportation.
If you’re planning to relocate to Europe for business purposes, opting to set up a limited company offers a quicker and more advantageous approach. A limited company offers limited liability protection, easier access to capital, and perpetual succession.
Countries like Poland, the Netherlands, and Estonia are known for quick, digital company registration, tax benefits, and startup-friendly policies.
This varies by country and business type. Some visas may require a minimum investment (e.g., €50,000–€200,000). Always check local requirements.
